Relationship between Service Marketing Mix and Customer Based Brand Equity

In the competitive modern world, the brand is a powerful tool to support upgrading values to services or products and it is also one of the company’s most valuable assets. To promote the sale of any brand, marketing mix elements are becoming necessary. Aaker (1991) stated that marketing is a major way of creating five-dimensional of consumer perceptions. He also mentioned that marketing mix is a major driver of brand equity if it owns a significant market share of the business with advertising. The combination of service marketing mix elements has a major effect on the dimensions of customer-based brand equity. 

Figure 2.5 Relationship between Service Marketing Mix and Customer Based Brand Equity

Source: Arabian Journal of Business and Management Review, E-ISSN 2223-5833

Figure 2.6 David Aaker’s Brand Equity Model

Source: Aaker Model

Walgren et al. (1995) stated that brand equity is a strong relation with advertising; companies with heavy advertising budgets have a greater value for brand equity than those companies with lesser advertising budgets. Brand equity and the marketing mix are interlinked. In this section, previous researches on the effect of marketing mix elements on brand equity are discussed.  

Edo Rajh (2005) evaluated the impacts of marketing mix elements on brand equity. This research had shown that various marketing mix elements have an influence on brand equity with different degrees of intensity, in addition, certain marketing mix elements may have a negative impact on the development of brand equity. His research findings highlight very strongly the value of a strategic approach for brand management, with the act of creating brand equity, and not just sales and revenues of the brand, to determine the implementation of specific marketing mix elements. If the emphasis of brand management is solely on sales, these marketing activities can easily be selected (for example, activities to reduce prices) That are likely to boost short-term sales, but maybe bad image for the brand equity in the long-term. The results of this research highlight the importance of the right selection of individual marketing mix elements to prevent the worsening of the brand equity achieved.

Hamid Taboli, Neda Pariz, Masoud Vafada (2017) analyzes the marketing mix’s impact on brand equity in the selling of Pishro Plastic Khazar Company’s floor covers of automobiles. The price can influence the brand equity of the product by affecting the perceived quality of the brand. Findings show that the channel of distribution influences perceived quality so it is suggested that the managers should be made moving towards improving brand equity through careful planning, efficient leadership, advertising, and a suitable budget to extend distribution channels, increasing the number of agencies.

Mohammad Aghaei, Elham Vahedi, Mohammad Safari Kahreh, Mahdi Pirooz have researched the connection of the dimensions of brand equity and product, price, place, promotion, people, process and physical evidence. This research study focuses on Aaker and Joachimsthaler (2000), evaluates the effects on the marketing mix of services on brand awareness, brand association, perceived quality, and brand loyalty. It shows that a positive viewpoint of customer increase in brand awareness, brand association, perceived quality and brand loyalty; the level of brand equity is also high too. In addition, there is a meaningful and absolute link between the service marketing mix and brand equity, as well as anything that strengthens factors such as product, price, place, promotion, people, process and physical evidence.

Mirza Hassan Hosseini and Hamed Moezzi (2015) stated the influence of the marketing mix on brand equity in the insurance business (case study: Asia Insurance Company, Iran). It is also revealed that there is a strong relationship between the three dimensions (quality, loyalty, and awareness) and brand equity. In Asia Insurance Company, brand loyalty has a stronger connection with the brand name and brand equity. Ratings of marketing mix elements depending on their influence on brand equity are the image of the company, the increase in sales, propaganda, price, and distribution. As the findings show, the most effect on brand equity is the brand image, sales increase, and propaganda.

Kim and Hyum discussed the cumulative effect of marketing and brand image on brand name and brand equity in the information technology environment. They noticed that consistent interaction with brand equity and image of the company and make partial or minor changes to the combined influence on the other three brand equity dimensions.

Kajouri assessed elements affecting the brand equity of insurance companies. The results indicate that perceived quality, brand loyalty and associations affect directly brand equity and brand awareness is indirectly significant on brand equity.

Azadi studied the influence of marketing mix on the customer’s primary consideration In selecting an insurance company. The findings show that marketing mix effects on the insurance company’s customer primary concern and customer choice of an insurance company are more influenced by 7Ps (Product, Price, Place, Promotion, People, Process and Physical Evidence).